Athens would fail to clinch a pact on almost 12 billion euros of savings before euro zone finance ministers meet on Monday

World Bulletin/News Desk

Greece is making progress in agreeing new austerity measures with its international lenders but needs another two weeks to wrap up a deal, a senior government official said on Saturday.

The comments confirmed that Athens would fail to clinch a pact on almost 12 billion euros of savings before euro zone finance ministers meet on Monday, but both sides indicated progress was being made.

The cuts are necessary to keep the Greek budget within the targets set by the European Union and International Monetary Fund under the terms of the latest multi-billion-euro bailout staving off bankruptcy.

"There is good progress in the talks with the troika, there is convergence," a senior finance ministry official, who declined to be named, said after talks in Athens between Finance Minister Yannis Stournaras and officials from the troika of lenders - the EU, IMF and European Central Bank.

"We do not expect to have agreed on something before the eurogroup meeting," the official said, adding that talks would continue for another two weeks.

Greece's coalition government is trying to spare angry Greeks even deeper wage and pension cuts after five consecutive years of recession that have driven unemployment to record levels and slashed household incomes.

The official told reporters that Athens hoped for a statement from euro zone finance ministers on Monday confirming progress in the talks.

"This positive statement will be the signal for talks to continue ... next week and the week after that," he said.

Speaking in Riyadh on Saturday, IMF chief Christine Lagarde said talks on the fiscal chapter of Greece's programme had been "very good and productive". The talks also cover structural reforms, financing and debt sustainability.

EU Commissioner for Monetary Affairs Olli Rehn also spoke of progress, saying negotiations had "moved on" and that agreement was possible in the coming days.

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